Interview with David Sønstebø

IOTA: A Summary of Success

Just reading the basic features of IOTA, makes it look like a wishful solution to almost every problem in the cryptocurrency-sphere.

IOTA managed to grow to the most promising cryptocurrency-project on the planet. But what are the reasons for that?

As you know: Tangleblog.com is a blog for news, announcement and background info around IOTA, an outstanding innovative software ecosystem that possibly changes the future.

So it’s no secret that I’m heavily biased. I invested in IOTA and I see no reason to abate my enthusiasm. Why would anyone invest in a poor asset? Why would anyone want to work with a dinosaur?

In fact, I believe in this technology so much, that this post is nothing less than a declaration of trust.

David Sønstebø, Dominik Schiener and the rest of the founders managed to assemble an extraordinary group of people that work for the IOTA-vision.

Since “Cryptoland” is mostly inhabited by speculating people, this foundation is living proof, that this venture is everything but an ROI oriented enterprise.

These members are no “no-names”, but adepts with top-notch expertise and the highest level of development skills, cryptography experience, business management, and leading experts in their sphere.

Plus: I’m pretty sure that there are additional members that are not yet revealed.

The story of each member and developer can be found here: official blog

When I think about my investment, I also think about the names and skills of these experts, so why should I worry at all?

IOTA is a grassroots movement and these people pave a solid way for the healthy growth of IOTA.

There is nothing more an investor would want. And there is nothing more a developer could ask for.

Link to the 2$ Million Development fund. Apply now and get support for your idea!

The Features

The variety of features in the blockchain space is huge. Every Blockchain project tries to find a niche for growth and to get more investments.

Judging from the idea of Satoshi Nakamoto in 2008, the meaning of the invention Blockchain was something like emancipation, innovation, a new technology for the people.

An idea of democracy coded into an unstoppable currency, that had an aura of Matrix and Robin Hood.

But in the last years, most of these born assets weren’t longer aligned with the idea of “making the world a better place”.

Lot’s of projects were created, simply to earn money, while there was no real development to solve a real-world problem.

There are some projects that handle it differently, like Ethereum, Dash, NEM, etc. but the majority is stuck in Cryptoland with no expectation for a real-world usage.

IOTAs features, however, are unique among ALL cryptocurrencies. First of all: IOTA is no Blockchain, but a DAG aka the Tangle. The first of its kind.

The Tangle inherits all advantages of a Blockchain but does not possess any of its flaws.

A technology, that offers free value transfer (no transaction fees), real decentralization, a new ternary approach and a ternary hardware solution to solve the biggest problems of the IoT.

A technology that gets stronger, faster and more reliable, the bigger the network grows.

The fourth industrial revolution will be a transition of the world economy, where few benefit and whole countries suffer disruptions if no proper solution is found.

The founders of IOTA thought about that from the very beginning, when the vision was formed.

If I were a developer, I wanted to work with IOTA because some technologies won’t survive this transition. And some will become industry leaders.

As an investor, there is no better project on the horizon and no better technology to look for in 2017. A no brainer.

Blockchain limitations

Cryptocurrency-investments are a sensitive area that demands time and patience.

If you invest your (life-) savings into a digital asset, without regulation or an institution to protect your money, you should probably look out for the most promising, and serious acting project.

In a comparison to IOTA’s technological core, Blockchains, in general, can’t keep up, because the scalability problem is part of their architecture. Yes, the problem is no bug, it’s actually a feature.

Blockchains possess an anti-spam mechanism that changes the difficulty of the cryptographic puzzles, that has to be solved to get parts of the currency.

The more people mine Bitcoin for example, the heavier the hash-cash proof of work gets. As a result, people mine less and less Bitcoins. This implemented feature is a deflation to increase the value and price of Bitcoin and a mechanism that prevents people from slowing the network because the more hash-power they use, the harder it gets to be successful.

Since most cryptocurrencies are being used by a lot more people recently, this mechanism becomes their Achilles heel, because blockchains start to collapse under their own weight.

The more transactions we conduct, the faster the blocks are filled, that confirm the transactions per consensus-model (synchronicity, actuality).

With a rising difficulty, the transaction fees grow bigger and bigger, to prevent people from spamming the network with countless transactions.

As a result, Bitcoin becomes expensive to use and transactions are confirmed slower, the more people use it. That’s not an Achilles heel, it’s more like Achilles leg.

It seems like the creators didn’t believe in a bigger adoption from the beginning, or there was no thorough consideration of the deflation-model.

Bitcoins “Blocksize-debate” is just the beginning of debates in almost all Blockchain-projects. Blockchains have a flawed architecture, that makes it impossible to scale like IOTA, like the Tangle does.

I know that the interoperability approach of IOTA also aims for collaborations with other Blockchain-projects, but as an investor, I see no reason to invest elsewhere on the long-run.

Bitcoin and the most promising Blockchain-projects will probably rise in value anyway because the expectation value and network effect is a big magnet for investors.

The IoT and the demand for a problem solver

The Internet of Things is defined:

“in Recommendation ITU-T Y.2060 (06/2012)1 as a global infrastructure for the information society, enabling advanced services by interconnecting (physical and virtual) things based on existing and evolving inter-operable information and communication technologies”.

A network of billions of devices in a globally connected environment. The use-cases are almost infinite, new markets are emerging, technical limitations are already perceptible.

How can we create a future for the IoT with a global network that benefits everyone?
What about security issues like botnets, like DDoS attacks?

The Blockchain-technology offers the first approach, yes. But if we already have scalability problems today, then what happens in a few years when presumably every second, billions of data- or value transactions are sent all over the globe?

The Tangle scales almost infinitely because the scalability is based on an altruistic rule: give more than you need.

(Source: www.iotasupport.com)

To make a transaction, you need to confirm two unconfirmed transactions randomly per proof of work. This leads to two characteristics of the tangle:

a) The more people use IOTA, the faster it gets

b) True decentralization because there is no mining involved that incentivises people to earn money.

IOTA is not about earning money, but about enabling the machine economy of the Internet of Things.

A possible candidate for solving the real problems of tomorrow.

For me personally, one of the most important reasons I invested in IOTA and I became a member of this great community!

The growing interest in Cryptocurrency in general

Apart from the real-world usage of cryptocurrencies, the invention Blockchain attracts more people every day.

Generally spoken, the crypto-sphere is yet a small unimportant area, but considering the latest growth and interest of companies all over the world, there is a huge demand and an even bigger inflow of money. That makes cryptocurrencies in general to assets with great prospects.

Since IOTA combines a unique functionality and a promising real-world usage without competitors, we can expect that a big part of that new money is going into IOTA.

The network effect alone is what IOTA lacks in comparison to the top 5 projects, but that is just a matter of time.

Because right now, IOTA isn’t even listed on exchanges.

Involved Companies

For now, a nice number of legit companies and institutions that collaborate with IOTA have been officially announced:

We know that there are a lot more judging by the slack inhabitants that are not announced yet.

Microsoft

Innogy

Ubuntu Canonical

University of Lancaster

Hyperledger

Chain of Things

Countless Companies behind NDA’s

Countless Academic collaborations

To the foundation members and advisors connected companies

The Numbers

IOTA is still under the radar, but there are great indicators that this won’t take long to change.

First of all the google-trends curve of the last 12 months:

IOTA is slowly getting more attention as the ecosystem grows every day.

Especially mid-April, the keyword “Iota tangle” peaks for the first time.

The slack growth is another big indicator that IOTA gains attraction.

We already have 2675 members and it’s growing exponentially, as you can see in the plot, made by @eragmus.
The timeframe is relatively short, so it appears linear but the growth is actually exponential.

We already have over 720k (720000) messages around development and IOTA all in all.

Conferences, Presentations, Hackathons

The reasons for the overall growing numbers are that the founders, and especially Dominik Schiener, are participating in conferences, hackathons, and presentations for months.

I haven’t seen comparable dedicated developers and founders in any other project so far.

These conferences are of huge importance as they attract many partners, new collaborations, and public awareness.

IOTA shows the world, that it’s truly a positive anomaly in the sphere of cryptocurrencies. And that they are not afraid of telling anyone!

The Strategic Management

The roadmap of IOTA, the strategic management, especially by David Sønstebø, and the decisions so far turned out to be extremely beneficial for IOTA.

From the very beginning, it was clearly and transparently communicated that IOTA is a real-world enterprise to make a difference, therefore all available resources and connections have been arranged before IOTA gets listed on an exchange.

The focus on the functionality and a healthy growth is the biggest point on my agenda, that IOTA will eventually become one of the biggest cryptocurrencies and important “blockchain-related” technologies in 2017 and in the coming years.

I have no doubt that through IOTA, and the altruistic approach, the interoperability and the scalability advantages of the Tangle, the IoT will become less of a technical horror, but a transition we can look forward to.

So if you are a developer, I encourage you to participate and to become a part of this fantastic ecosystem, that is growing every day!

3 Replies to “IOTA: A Summary of Success”

I am not a developer, I am a counsellor of people by occupation. However I knew the concept of IOTA was important even before a colleague and friend told me about the IOTA white paper in the summer of 2016. I am aware of the need for a decentralized payment system that creates its network and proof of work using the peripherals of the network users. To my mind, it stands to common sense that this will be both necessary and possible. I was surprised, actually, to realize that something like IOTA is being created so early. And the idea of machines earning and spending money independent of human interaction and influence – the ‘internet of things’ clearly raises the stakes. It sounds very much to me like the makings of one very big computer, similar in a way to Vitalik Buterin’s idea that Ethereum is a world computer that cannot be shut down. Bear in mind technology is 50% of the puzzle, the other 50% is the human equation. Yes, Bitcoin is hard pressed to scale, and yes IOTA theoretically solves that problem, but mark me, the root issue will prove to be human conduct.

@TechCrunch Would love that for the cryptospace, together with a standard they had to accept like using primary sources, commentaries have to be marked as such and conflicts of interests should be marked at the beginning of an article. Crypto desperately needs a standard. #iota #btc #eth